Strat Aero PLC Strategy & Financing Update, Appointment of Broker

Strat Aero PLC (LON:AERO), an international aerospace company focused on the rapidly emerging Unmanned Aerial Vehicle (‘UAV’) sector, has today announced a financing and strategy update which is designed to facilitate the continued development of the Company’s two core businesses; ‘Training & Education’ and ‘Survey & Inspection’, in addition to implementing an enhanced growth strategy via the appraisal of complementary acquisition or investment opportunities. This is in line with the Company’s stated objective to achieve improved financial performance in the near term.

Overview

Raised £590,000 (before costs) through a Placing (the “Placing”) of 1,685,714,286 ordinary shares of 0.01 pence in the Company (“Ordinary Shares”) at a price of 0.035 pence per Ordinary Share (the “Placing Shares”)

1,011,428,571 Warrants with a six month expiry and an exercise price of 0.035 pence have also been issued in conjunction with the Placing

In addition, to limit dilution to existing shareholders, qualifying shareholders will be invited to participate in this fundraising through a proposed open offer to raise up to a further £500,000 by the issue of up to 1,428,571,428 Ordinary Shares at the price of 0.035 pence per Ordinary Share (the “Open Offer”)

The net proceeds of the Placing together with any further funds raised from the Open Offer, will be used for working capital, to strengthen the Company’s balance sheet and facilitate the following:

o Potential strategic investment in complementary businesses and assets for which several exciting opportunities have been identified

Proposed appointment of Mr. Trevor Brown, a strategic investor with more than 30 years’ experience in growth companies, to the Board as an Executive Director following his subscription for 971,428,571 Placing Shares, representing 27% of the total enlarged capital of the Company.

Intention for certain directors to subscribe for a further 85,714,286 Ordinary Shares at the Placing Price in settlement of outstanding compensation and expenses accrued during 2017 – a further RNS will follow on completion

Iain McLure, CEO of Strat Aero plc, commented, “Together with the consolidation and rationalisation of Strat Aero over the past two years into a business that is focused on what it does best, specifically Training & Education and Survey & Inspection, today’s placing and the proposed Open Offer, not only place Strat Aero in a much stronger position operationally, but also lay the foundations for growth – both organic and via strategic acquisition. I believe Strat Aero is now transitioning into a period of sustainable growth, one that is based on capitalising on our unique skillset and experience in the UAV sector and survey and inspection businesses.

“The exciting opportunities we have identified and our strategy to capitalise on them have clearly resonated with certain members of the investment community – most notably, the well-known strategic investor Trevor Brown, who has subscribed for 58% of the total Placing Shares and who has also agreed to join our Board as an Executive Director, subject to the completion of customary due diligence I am also pleased that myself and Paul Ryan intend to convert outstanding fees to increase our shareholdings aligning our interests with those of shareholders.

“I believe Strat Aero is now at a pivotal stage in its development and I look forward to providing further updates on our progress, as we look to generate enhanced value for our shareholders through the provision of value-add based services and solutions.”

Mr Trevor Brown, a strategic investor in real estate and equities for more than 30 years, has been nominated as a proposed new Executive Director of the Company following his subscription for 58% of the Placing Shares.

Mr Brown is currently an Executive Director of Flying Brands plc, CEO of Braveheart Investment Group plc and a Non-Executive Director of Management Resource Solutions plc.

More recently, Trevor was a director of AIM listed Feedback plc and of Advanced Oncotherapy plc.

Further updates regarding Mr Brown’s proposed board appointment will be made in due course.

Admission of and Dealings in the Placing Shares

The issue of the Placing Shares is conditional on their admission to trading on AIM (“Admission”). Application is being made for the Placing Shares to be admitted to trading on AIM and it is expected that Admission will become effective and dealing in the Placing Shares will commence on 8th December 2017. The Placing Shares will rank pari passu with existing Ordinary Shares.

Following Admission, the total issued share capital of the Company will be 3,649,999,548 ordinary shares. The Placing Shares will represent approximately 46% of the enlarged share capital of the Company prior to the Open Offer.

The above figure of 3,649,999,548 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in Strat Aero under the FCA’s Disclosure and Transparency Rule.

Open Offer

A further announcement concerning the timetable and other details of the Open Offer will be made shortly and a circular sent to shareholders at the same time.

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